Power Factor Correction: What It Is and When It's Worth Fixing
A poor power factor can add a real penalty to an industrial or commercial bill. Here's what it means and how correction actually pays back.
What power factor actually measures
Power factor describes how efficiently electrical power is being converted into useful work — a low power factor means more current is being drawn than is actually needed for the work being done, largely caused by inductive loads like motors and older lighting ballasts. Many utilities directly penalise a low power factor on commercial and industrial bills, separate from the base energy charge.
How correction actually works
Power factor correction equipment (capacitor banks, typically) offsets the inductive load's effect, bringing the power factor closer to ideal and reducing or eliminating the associated penalty. It's a well-established, mature technology — the engineering isn't the hard part; sizing it correctly for the site's actual load profile is.
When it's actually worth doing
For a site already being charged a power factor penalty on its bill, correction usually pays back quickly and predictably, since the penalty removed is a direct, measurable saving. For a site with a decent power factor already, or one on a tariff that doesn't penalise it, correction isn't a priority — which is exactly why this should be checked against the actual bill and tariff structure before being recommended, not assumed as a default fix.
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